It’s been a tough ride for the crypto market in 2022. By November the market was down by 70 percent from its previous high on November 20, 2021. Just when the market was going downhill, the FTX crash made them look even worse. So, will the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The crypto market, especially Bitcoin has experienced its fair share of dips over the years. Every time, it’s bounced back by a massive increase.
For instance, in 2013, Bitcoin reached a peak of $1,160. It then plummeted for a full year before hitting a low of $150. In 2017, it broke that record and reached a new record high of $19,600. Then, in 2018, and it was trading at $3,100. And in 2020, the price broke through that resistance and hit a new peak of $68,000 in the month of November 2021. Then, just like that we’ve seen another dip. However, history has shown us that at the end of every dip the bull runs.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen before, fall-offs tend to be followed by a lengthy bull run that finally overcomes the resistance set by the previous market’s highest price. This is evident not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Blockchain and cryptocurrency technology has come a long way in the last few years. With more and more businesses and industries adopting the technology, its use and acceptance is increasing. From finance to gaming the use of crypto is increasing in a variety of ways. And this growing use case can lead to increasing participation in the crypto market which could increase the price.
Increased institutional interest in crypto
In recent years, we’ve seen a growing interest from institutional investors in cryptocurrency. From hedge funds to banks, many large institutions are starting to explore the potential for crypto-based assets. The increased interest of institutions could provide more stability to the crypto market and result in more expensive prices.
As the market for crypto is maturing and mature, governments across the globe are beginning to develop more favorable rules for crypto. This is likely to attract more investors and increase the mainstream adoption of crypto.
A broader range of blockchain applications
The underlying technology behind many cryptocurrency, blockchain, is a broad range of applications that go beyond the realm of financial transactions. From supply chain management to voting systems, more and more industries are exploring ways they can make use of blockchain technology, which could stimulate more investment and excitement in crypto.
Advancements in technology
Blockchain technology and cryptography are at the very beginning of development. As advancements continue to be made in areas such as scalability and security, the potential of crypto assets will increase. This could lead to more acceptance and higher prices.
Rising global economic uncertainty
Due to the constant economic uncertainty caused due to the COVID-19 pandemic as well as other factors, more and more investors are looking for safe haven assets like bitcoin and even gold. Because the global economic climate remains uncertain and uncertain, this could lead to more demand for crypto as well as more expensive prices.
Retail investors are able to earn interest
The institutional investors aren’t alone in one who’s showing an interest in cryptocurrency. Retail investors, also known as individual investors are also beginning to get involved in the cryptocurrency market. With increasing numbers of people become aware of crypto and the best ways to invest in it this could result in more demand and higher prices.
The growing awareness and acceptance of crypto
As the market for crypto continues to mature as more and more people are starting to learn about and appreciate the concept. As awareness and acceptance grows of crypto it could result in increasing numbers of people purchasing or holding cryptocurrency, and this could drive up prices.
Financial decentralization (DeFi) is an emerging area of the crypto market that allows the provision of financial services built on top of blockchain technology. As DeFi continues to grow and more platforms and projects come online, this will lead to a rise in adoption and more expensive prices for crypto.
The development of crypto payment methods
As the crypto market is growing as more and more businesses are beginning accepting crypto payments as a means of payment. This could lead to an increase in the use of crypto in regular transactions, and a rise in prices.
More investment from sovereign wealth funds
These funds are government-owned investments, are starting to explore cryptocurrency as a possible asset class. As more of these funds devote a percentage or their entire portfolios to cryptocurrency, this could result in a rise in demand and more expensive prices.
Utilization of crypto to make cross-border payments
One of the main advantages of crypto is its capability to perform quick and inexpensive cross-border payments. As more businesses and individuals begin to use crypto for international transactions, it could result in increased the demand for it and a rise in prices.
The number of ATMs that accept crypto is increasing.
The number of ATMs that accept crypto continue to grow it will be easier for people to buy and keep cryptocurrency, which can boost demand and increase prices.
Security tokens are developed for development
Security tokens, also known as digital assets that are used to represent ownership in an asset like stock or real estate is a fast-growing sector of the crypto market. As more security tokens are issued and traded, it can lead to a higher demand and higher prices for crypto.
Merchants are more likely to adopt the concept.
In the event that more businesses accept crypto as a means of payment, it will make it easier for consumers to use and hold cryptocurrency, which will boost demand and increase prices.
So, will crypto grow in 2023? The only way to know is time. However, with these aspects being considered, it’s likely that the crypto market will see a recovery in 2023. If you’re in it for the long run patience and discipline will be key.